bombardier – Financial Posthttp://business.financialpost.com
Canada Business News | Financial Updates & InformationFri, 18 Aug 2017 04:43:52 +0000enhourly1http://wordpress.com/http://1.gravatar.com/blavatar/b4ece3189893389a03f063830eacd95c?s=96&d=http%3A%2F%2Fs2.wp.com%2Fi%2Fbuttonw-com.pngbombardier – Financial Posthttp://business.financialpost.com
‘First step in a long process’: Quick end to U.S. Bombardier probe unlikely, trade experts sayhttp://business.financialpost.com/transportation/investigation-into-boeing-petition-against-bombardier-expected-to-move-forward-trade-experts/wcm/4f93a2ff-a0f4-452e-a7f4-a7039d363332
http://business.financialpost.com/transportation/investigation-into-boeing-petition-against-bombardier-expected-to-move-forward-trade-experts/wcm/4f93a2ff-a0f4-452e-a7f4-a7039d363332#respondWed, 07 Jun 2017 20:10:04 +0000http://business.financialpost.com/?p=766652]]>The United States International Trade Commission is expected to vote Friday to press on with an investigation of Bombardier Inc.’s trade practices following a complaint from the Boeing Company, a probe that could complicate Bombardier’s ability to sell its C Series jets in the U.S. market.

Boeing filed a petition in April with the USITC and the U.S. Department of Commerce seeking an anti-dumping, countervailing duty order against the sale of the C Series, alleging that massive government subsidies have allowed Bombardier to embark “on an aggressive campaign to dump its C Series aircraft in the United States.”

On Friday the USITC is slated to vote, based on a preliminary investigation, on whether there is reasonable indication that Boeing was materially injured or threatened with material injury as a result of Bombardier’s alleged sale of subsidized jets for less than fair value.

The vote will take place at 11 a.m. in Washington, D.C. The USITC is expected to file its preliminary determination by Monday, and a public version of the report will be available in July.

If the USITC determination is negative, then both the USITC and the Department of Commerce investigations would end.

However, trade experts say this is highly unlikely. Lawrence Herman, international trade counsel at Herman and Associates, said “it’s a virtual certainty” that the USITC will find there is enough evidence to continue its investigation.

“This is the first in a long series of steps that will almost certainly lead to trade challenges by Bombardier itself,” Herman said.

Bombardier said in a statement released after staff testified at a USITC hearing last month that the company will continue to engage with industry leaders, government officials and the public to demonstrate that it honoured all international trade law obligations.

“This was the first step in a long process to demonstrate that Boeing’s petition is unfounded and would harm the airlines, the travelling public and innovation in the aerospace industry,” said Mike Nadolski, vice president of communications at Bombardier.

Karl Moore, a professor at the Desautels Faculty of Management at McGill University, said the petition is likely part of Boeing’s strategy to prevent Bombardier from becoming a major player in the U.S. market.

“This is some sabre-rattling to make airlines in the U.S. nervous about the C Series and think, ‘maybe it’s a risk.’ It could potentially hurt Bombardier’s sale efforts in the U.S. That’s probably the main thing Boeing is looking for,” Moore said.

At the crux of Boeing’s petition are two order bids Bombardier participated in: A United Airlines order for 65 737-700 jets that Boeing said it was forced to offer at discounted prices because of Bombardier and, most significantly, Delta Air Lines’ order for 75 C Series Jets.

In a post-conference brief filed on May 23, Delta sided with Bombardier, saying there has been “no reasonable indication of threat of material injury” to Boeing.

“By its own admission, Boeing never tried to sell new aircraft to Delta in the transaction at issue. The firm order placed with Bombardier cannot be the reason for any alleged threat of injury when Boeing does not make an aircraft the size Delta needed,” the airline said.

The preliminary investigation, which included briefs filed by lawyers representing Boeing, Bombardier, Delta Air Lines and the Canadian government, has offered a glimpse at the negotiations behind major aircraft orders.

Delta’s road to the C Series began when it says it decided to seek aircrafts with a capacity of 100 to 110 seats as part of its strategy to shift from flying regional jets to larger narrow-body aircrafts. The airline initially placed an order for 19 used Brazilian Embraer E-190s from Boeing, which had obtained them from a trade-in with Air Canada.

However, according to the brief, Delta found out the global supply for the E-190s was limited and pricing was as much as 40 per cent higher for the remaining jets it required, so it reconsidered its options. It was at this point that Bombardier’s C Series jets became a leading contender.

Delta said that while Bombardier had secured other customers for the C Series, “it still needed the market validation of a high-profile and well-respected marquee airline making a large purchase.” The airline said it saw this as an opportunity to secure a “customary marquee purchase price” — a widely recognized feature where customers receive favourable pricing that reflects the risk associated with purchasing new aircraft.

That price, Boeing has argued, was below the cost to manufacture a C Series aircraft, something both Delta and Bombardier have disputed.

Jesse Goldman, partner of international trade and investment at Bennett Jones LLP in Toronto, said a positive determination is likely, and that the ensuing investigation will be both complicated and lengthy.

“I think Boeing has a difficult case in some respects,” he said. “They are complaining about an injury into a segment of the aircraft market which they haven’t sold any aircraft for a number of years in that seat and size range.”

Boeing alleges that Bombardier is using highly distortive pricing to eliminate the 737 MAX 7 from the 100 to 150-seat single aisle market, which will allow the Quebec company to bring in a CS500 — a medium single-aisle jet that would compete with Boeing’s 737-800 and MAX 8.

“The U.S. industry has been the victim of this exact strategy before, as subsidies to Airbus enabled it to push McDonell Douglas and Lockheed from the market, capture 50 per cent of the global market share, destroying countless high-paying, skilled U.S. jobs in the process,” Boeing said.

Bombardier disputes Boeing’s assertion that the C Series jet competes with the smaller 737 and MAX aircrafts, and argues that the material injury that could be inflicted on the U.S. market is “speculative and far in the future.”

“By focusing only on its smallest and least successful 737 models, Boeing has created an artificially narrow like product,” Bombardier said in its post-conference brief.

“Boeing’s petition in this case is unprecedented in its overreach.”

Financial Post

]]>http://business.financialpost.com/transportation/investigation-into-boeing-petition-against-bombardier-expected-to-move-forward-trade-experts/wcm/4f93a2ff-a0f4-452e-a7f4-a7039d363332/feed0cseriesasiekierskaAre better times ahead for Bombardier shares? BMO updates stock to outperformhttp://business.financialpost.com/transportation/are-better-times-ahead-for-bombardier-shares-bmo-updates-stock-to-outperform/wcm/680c87e7-9c17-4f5a-ab24-c30cce721a13
http://business.financialpost.com/transportation/are-better-times-ahead-for-bombardier-shares-bmo-updates-stock-to-outperform/wcm/680c87e7-9c17-4f5a-ab24-c30cce721a13#respondMon, 29 May 2017 21:39:01 +0000http://business.financialpost.com/?p=764507]]>Bombardier’s ongoing five-year restructuring campaign is on track to significantly improve operating margins, according to a BMO analyst who is upgrading the stock despite the turnaround plan’s high degree of risk.

Fadi Chamoun raised the Quebec-based company’s rating from perform to outperform and said the 2020 valuation could surpass $5.00 if management is successful with the plan, which aims to improve productivity while reducing costs and focusing on key product development. He maintained his current target price of $2.75.

The upgrade comes after BMO hosted Bombardier management for a “two-day roadshow,” which Chamoun said led to a “greater conviction in our financial forecasts for Bombardier, which we believe support a higher share price.”

“To be clear, this is a high-risk turnaround story but we believe that the senior leadership team has sufficiently moved the needle from ongoing restructuring efforts to deliver on 2018 financial targets and the five-year restructuring plan has been meaningfully de-risked,” Chamoun wrote in a note to clients released Monday.

Chamoun also noted that as a substantial product development cycle wraps up in 2018, “revenue growth should begin to re-accelerate providing for greater coverage of overhead costs and underpinning further margin improvements, particularly in the aerospace segment.”

However, Chamoun noted there remains uncertainty regarding long-term earnings as well as cash flow outlook for Bombardier’s Commercial Aircraft division, which features its C Series jets.

After a tumultuous period leading up to its annual general meeting where major institutional shareholders withdrew support for Bombardier’s executive board director, Pierre Beaudoin, the company had a week of positive news that included a settlement in a commercial dispute, and the delivery of its first CS300 jet to Swiss International Air Lines.

Bombardier said it delivered its first CS300 aircraft to Swiss Air on Friday, marking a milestone for the company’s previously beleaguered C Series program. The maiden trip for the aircraft is scheduled for June 1.

Last Wednesday, Bombardier and U.S. aerospace supplier Triumph reached a settlement five months after the Quebec-based company was hit with a $455-million lawsuit alleging that Bombardier failed to pay for expenses related to changing designs for the Global 7000 business jets.

The settlement — the terms of which were not publicly disclosed — was viewed as a “win-win agreement” by Macquarie Capital Markets analyst Konark Gupta, as it removed the largest overhang on the development of the Global 7000 jets.

“It is too early to conclude but re-negotiated cost terms could potentially put some pressure on G7000 margin curve in the long term, although we believe Bombardier could cut costs elsewhere to hit its margin targets,” Gupta said in a note to analysts last week.

However, some uncertainty remains, particularly as Bombardier fights an anti-dumping and countervailing-duty petition launched by U.S. aerospace giant Boeing.

In a post-conference brief filed with the U.S. International Trade Commission last Friday, Boeing said it “had already been harmed by Bombardier’s illegal campaign targeting the U.S. market.”

Bombardier, meanwhile, has said the petition is “unprecedented in its overreach.”

“There have been no subject imports. There are no lost sales or lost revenues. Boeing doesn’t even make a product that competes with the aircraft Bombardier offered in the sales campaigns that Boeing complains about,” Bombardier said in its opening statement at the USITC preliminary conference last week.

A preliminary determination on the petition is expected June 12.

Bombardier shares closed up 3.6 per cent at $2.33 Monday.

Financial Post

]]>http://business.financialpost.com/transportation/are-better-times-ahead-for-bombardier-shares-bmo-updates-stock-to-outperform/wcm/680c87e7-9c17-4f5a-ab24-c30cce721a13/feed0052917-545464180-bombardier_as_may_29-W.jpgasiekierskaBombardier in talks with Chinese aircraft manufacturer for potential investment: reporthttp://business.financialpost.com/transportation/bombardier-in-talks-with-chinese-aircraft-manufacturer-for-potential-investment-report/wcm/38721cd4-a38a-455c-8812-f9ee2bc32bf7
http://business.financialpost.com/transportation/bombardier-in-talks-with-chinese-aircraft-manufacturer-for-potential-investment-report/wcm/38721cd4-a38a-455c-8812-f9ee2bc32bf7#respondThu, 18 May 2017 16:07:46 +0000http://business.financialpost.com/?p=762006]]>Bombardier has reportedly held talks with the Commercial Aircraft Corporation of China Ltd. (Comac) about a potential investment in the Montreal-based company’s commercial aerospace division.

According to a news report by the Financial Times, sources said Comac — China’s state-owned aerospace manufacturer — is working with at least one bank on a deal that could involve an investment in Bombardier’s commercial aerospace division, or a stake in its CSeries program.

A spokesperson for Bombardier said the company would not comment on market rumours or speculation.

Bombardier received $1 billion from the Quebec government for its CSeries program, and the federal government provided a $372.5 million loan towards development of its Global 7000 business aircraft program, as well as the CSeries program.

Earlier this month, Comac’s C919 completed its maiden flight in Shanghai. The aircraft is the first independently developed by China.

“This is not only a major historic breakthrough in China’s aviation industry, but also a significant achievement made by China in deeply implementing the strategy of driving development by innovation and comprehensively promoting the structural reform of the supply said,” Comac said of the maiden flight in a news release.

Bombardier has previously engaged in partnerships with the Chinese manufacturer.

In 2012, Bombardier announced it planned on strengthening its strategic partnership with the company with an agreement that involved collaboration on the development and customer operating efficiencies of the C919 and Bombardier’s CSeries.

Bombardier’s CSeries program is currently at the centre of what could be a major trade dispute between Canada and the United States.

Last month, American aerospace giant Boeing filed a petition to the U.S. Department of Commerce seeking an anti-dumping, countervailing duty order against the sale of Bombardier’s CSeries aircraft. Boeing has alleged that Bombardier sold the jets to Delta at an “absurdly low” price, well below the cost of manufacturing the jet.

Bombardier lawyers were in a Washington, D.C. courtroom on Thursday, arguing against the petition and saying it was “unprecedented in its overreach.”

With files from the Canadian Press.

]]>http://business.financialpost.com/transportation/bombardier-in-talks-with-chinese-aircraft-manufacturer-for-potential-investment-report/wcm/38721cd4-a38a-455c-8812-f9ee2bc32bf7/feed0Bombardier_20160429asiekierskaMetrolinx signs deal to buy light-rail vehicles from Alstom in shot across Bombardier’s bowhttp://business.financialpost.com/transportation/metrolinx-signs-deal-to-buy-light-rail-vehicles-from-alstom-in-shot-across-bombardiers-bow/wcm/9d005650-da7f-4a3c-af71-8b5b39a3be26
http://business.financialpost.com/transportation/metrolinx-signs-deal-to-buy-light-rail-vehicles-from-alstom-in-shot-across-bombardiers-bow/wcm/9d005650-da7f-4a3c-af71-8b5b39a3be26#respondFri, 12 May 2017 20:27:51 +0000http://business.financialpost.com/?p=760677]]>Ontario’s transit agency Metrolinx, a major customer of Bombardier’s light rail vehicles, announced Friday that it has turned to a competitor of the Montreal-based company over “serious concerns” quality vehicles won’t be delivered on time.

The deal marks the latest blow to Bombardier, after a week that saw major institutional investors calling for a change in leadership due to a “lapse of governance,” eventually forcing the chairman of its board to relinquish his executive role.

Metrolinx said it has entered a contract with French-manufacturer Alstom for 61 light rail vehicles, a plan it calls “a safety net” in case Bombardier fails to deliver light-rail vehicles for two major projects in Toronto.

Under the $528-million agreement, Alstom will build 17 vehicles for the Finch West LRT project and, if necessary, 44 for the Eglinton Crosstown, both projects that Bombardier has already agreed to build vehicles for. The deal also includes an option for additional vehicles.

If Bombardier meets its contractual obligations and delivers vehicles on time, the 44 Alstom vehicles designated for the Eglinton Crosstown line will be reassigned to the Hurontario LRT project.

“Over the past several months, Metrolinx has had significant concerns regarding Bombardier’s ability to deliver quality vehicles according to the contract,” Ontario’s Minister of Transportation Steven Del Duca said at a news conference Friday.

“I refuse to stand idly by during this time of uncertainty. From my perspective, it’s essential that we take responsible action in order to ensure that we successfully deliver on our commitments to open these transit projects on time.”

Bombardier released a statement Friday saying the company is “ready, able, and willing to deliver these vehicles to the people of Toronto on time.”

“As the Minister and Metrolinx are well aware, these vehicles can be ready ahead of schedule and well before a single track has even been laid on the Eglinton Crosstown,” the company said.

It also said the pilot vehicle Metrolinx ordered is ready and undergoing qualification testing.

“We believe what’s best for the people of Toronto and Ontario is that we work together to ensure taxpayers are not on the hook for another cancelled contract,” the statement said.

“We have addressed the issues raised in the past and we are confident this will be upheld in the dispute resolution process.”

Murtaza Haider, a professor at Ryerson’s Ted Rogers School of Management, said although the Metrolinx announcement won’t impact any existing contacts, it causes further damage to Bombardier’s reputation.

“The Bombardier name has suffered,” Haider said. “I think it’s time management do some soul searching. It’s time for them to realize the monopoly position that they thought they had may not be the case and that, if push comes to shove, people will go out and find alternative sources to fulfill their needs.”

Bombardier responded by filing a court injunction to stop the cancellation, claiming Metrolinx was in fact responsible for project delays.

In April, the Ontario Superior Court of Justice ruled in favour of Bombardier, granting an injunction that temporarily halted the government’s transit agency from terminating the deal. Both parties will now participate in a court-ordered dispute resolution process.

Del Duca would not say whether the province would still consider Bombardier for future projects.

Metrolinx president and chief executive John Jensen said in a statement the agency cannot wait until after the dispute resolution — which could take a year to resolve — to determine whether Bombardier can meet its deadlines.

“We know for sure that Alstom’s light rail vehicles work. They are currently producing quality vehicles on-time for Ottawa’s Confederation Line LRT project,” he said.

“We are hopeful that Bombardier can get its program on track. However, the steps we are taking give us a safety net if it turns out Bombardier is unable to fulfill its contract.”

ASiekierska@postmedia.com

]]>http://business.financialpost.com/transportation/metrolinx-signs-deal-to-buy-light-rail-vehicles-from-alstom-in-shot-across-bombardiers-bow/wcm/9d005650-da7f-4a3c-af71-8b5b39a3be26/feed0bombardierasiekierskaPublic anger mounts as Bombardier set to outline plan to revise compensation for top executiveshttp://business.financialpost.com/transportation/bombardier-to-inform-shareholders-about-changes-to-executive-compensation/wcm/018d1d37-4f13-4f81-8b32-59c0c3d11058
Mon, 10 Apr 2017 13:55:31 +0000https://financialpostcom.wordpress.com?p=750723&preview=true&preview_id=750723]]>MONTREAL — Bombardier appears unable to shake off public anger over hefty pay packages to its senior executives.

Dozens of angry protesters launched paper airplanes in front of Premier Philippe Couillard’s Montreal offices on Sunday to protest how the executives are compensated.

Earlier, many of them waved signs and shouted slogans such as “too much is too much!” during a march that began in front of the company’s headquarters.
Many of the protesters said they wanted the Quebec government to impose conditions on companies that receive public money so jobs are protected and executive bonuses are limited.

“It’s our money, and the government is laughing at us,” said one protester, Pierre Brazeau. “If we don’t come out in the streets, they’ll continue to exploit us like they’re doing now.”

Bombardier has faced a storm of public criticism ever since it circulated documents showing six executives were in line for a roughly 50 per cent increase in compensation last year.

The increases came despite the fact the company recently received a $372.5 million loan from the federal government, and US$1 billion from the Quebec government.

Chief executive Alain Bellemare has since asked the company’s board of directors to delay payment of more than half of last year’s total planned compensation for six executives, including himself, to 2020, provided the company meets certain objectives.

Executive chairman Pierre Beaudoin also asked the board to cut his 2016 compensation by US$1.4 million to bring it in line with what he received the previous year.

Bombardier has said it will formally inform shareholders on Monday about changes to the compensation for several of its top executives when it files a new proxy circular with the securities regulator.

One protester, who gave her name only as Carole, said she hoped the demonstration would convince the company to repeal the pay hikes altogether.

“I’m hoping it will make a difference,” she said. “But I know that if we don’t do anything, nothing will change.”

Parti Quebecois legislature member Alain Therrien pointed out it was the second straight weekend of protests outside Bombardier’s headquarters.

“We can see this isn’t solved, even if Mr. Couillard would like it to be,” he said at the protest.

Quebec’s governing Liberal party used its majority to block several opposition motions calling on the government to take action last week, with Couillard arguing that government interference would send a bad signal to businesses.

The Canadian Press

]]>Bombardier_Compensation_20170409canadianpressnpFive things you should know before you start your work day on Nov. 11http://business.financialpost.com/executive/five-things-you-should-know-before-you-start-your-work-day-on-nov-11/wcm/4268895f-1484-4bf1-8611-b9577eae6280
http://business.financialpost.com/executive/five-things-you-should-know-before-you-start-your-work-day-on-nov-11/wcm/4268895f-1484-4bf1-8611-b9577eae6280#respondFri, 11 Nov 2016 09:00:49 +0000http://business.financialpost.com/?p=712410]]>Not everyone is heading in to work today in Canada because it’s Remembrance Day. We don’t have a paper Friday because of the holiday, but we do have stories online. Finance Minister Bill Morneau says his government is keen to talk about U.S.-Canada trade with incoming U.S. president Donald Trump. The CPP Fund now has about $300 billion in net assets. Bombardier’s turnaround seems to be taking hold. These stories and more in your morning cheat sheet to The Financial Post.

Donald Trump’s comments on cross-border trade during the U.S. election focused exclusively on Mexico, which he argues is getting too good a deal under NAFTA. That makes him pretty sour on the continental trade pact.

Bill Morneau, finance minister in Canada’s pro-free trade Liberal government, says it’s too early to know what Trump might do once he becomes U.S. president in January. But in a chat with the National Post editorial board, he says his government will aim to ensure the new president and his administration understand how important trade is between Canada and the U.S. He was quick to cite examples, mentioning both the daily cross border flow ($2 billion) and the annual tally ($760 billion), how many U.S. states have Canada has their largest foreign trading partner (35), and even putting a figure on the number U.S. jobs that depend on Canadian trade (nine million).

“We think there’s a huge advantage for the United States in having a positive trading relationship with Canada,” he said.

The Canada Pension Plan Fund, the public pension that awaits you in retirement, now has $300 billion in the kitty, according to a Sept. 30 second quarter financial report.

The CPP had net outflows of $400 million during the quarter, but had net investment income of $13.6 billion. That generated an investment return of 4.75 per cent, net of costs.

For the first six months of the year, the CPP fund grew by $21.6 billion. This included $17.7 billion in net investment income and $3.9 billion in net CPP contributions. The fund made a return of 6.3 per cent net of costs.

Bombardier issued quarterly results that indicate a turnaround plan may have the company on track to beat full-year profitability targets in all business segments.

“I understand — we all do here — that we still have a lot of work ahead of us, but Bombardier today is a much better and stronger company than it was a year ago,” chief executive Alain Bellemare said on a conference call with analysts.

To be sure, the company reported a net loss of US$94 million in the third quarter, but that’s a mere fraction of the US$4.89-billion loss it recorded in last year’s third quarter when it took US$4 billion in writedowns. Adjusted earnings per share were break-even, topping the three-cent loss expected by analysts.

Looking ahead, Bombardier says it expects to report full-year EBIT of between US$350 million to US$400 million. That’s improved from prior guidance of US$200 million to US$400 million. Revenues are forecast to come in around US$16.5 billion, the bottom end of its earlier forecast range.

The City of Vancouver is getting frustrated with the near-zero supply of rental homes in Canada’s most expensive property market.

Vancouver Mayor Gregor Robertson has rolled out the city’s latest policy response. Absentee landlords who have vacant homes will have to pay $10,000 a year in extra taxes as of Jan. 1, Bloomberg News reports.

The idea is to prod those landlords into making their homes available for lease. The city hopes the tax will free up enough rental space to boost Vancouver’s vacancy rate to 3.5 per cent from the current 0.6 per cent.

You might ask, What if those landlords simply fib about whether the homes have been rented? The city is promised to charge $10,000 a day in fines to people who lie.

Vancouver estimates that more than 10,800 homes in the city are empty, while another 10,000 are not “fully used.”

The special purpose acquisition company or SPAC is still a fairly new concept in Canadian business. Yet Acasta Enterprises, which raised $402 million in its July 2015 IPO, has just announced plans to deploy its funds on not one but three qualifying acquisitions: two Ontario-based consumer products companies and an Irish-based aircraft financing company.

SPACs raise funds from shareholders through an IPO, then must use those funds to buy another business within a limited time frame. Whatever deal the SPAC’s management lines up must be approved by the SPAC’s shareholders.

The need for shareholder approval can put a SPAC at a disadvantage relative to a private equity fund. But Acasta’s proposed suite of transactions suggests that a SPAC can be nimble too.

“We were never going to be a one-trick pony,” said Tony Melman, chief executive at Acasta.

]]>http://business.financialpost.com/executive/five-things-you-should-know-before-you-start-your-work-day-on-nov-11/wcm/4268895f-1484-4bf1-8611-b9577eae6280/feed01207morneauvonhasselbachIraq preparing order for five Bombardier CSeries: reporthttp://business.financialpost.com/transportation/iraq-preparing-order-for-five-bombardier-cseries-report/wcm/83c761f3-c83f-42cb-af79-a9567ff60616
http://business.financialpost.com/transportation/iraq-preparing-order-for-five-bombardier-cseries-report/wcm/83c761f3-c83f-42cb-af79-a9567ff60616#respondWed, 23 Oct 2013 15:29:20 +0000http://business.financialpost.com/?p=378988]]>The Government of Iraq has reportedly been authorized to purchase five of Bombardier’s new CSeries aircraft for its state-owned Iraqi Airways.

The contract is for five of the larger versions of the plane, the CS300, according to the report from the Iraqi news agency Aswat Al-Iraq, which cites a statement from the government’s Transport Ministry.

While the CS300 has a list price of $72-million, the report states that each plane will cost $40-million.

Bombardier has a complicated history with the Iraq government, which ordered 10 of its regional jets in 2008. But only four of the planes were delivered before Kuwait laid claim to the remaining regional jets stemming from a $1-billion ruling in the British courts related the seizure of several aircraft from Kuwaiti Airways during the Gulf War by the Iraq government.

Bombardier would not comment on the speculation that the Iraq government was preparing a CSeries order Wednesday. Although the Iraq government has been public about its interest in the plane.

“We are pleased the Government of Iraq has publicly expressed interest in the CSeries aircraft,” said Marianela de la Barrera, Bombardier spokeswoman. “I can acknowledge that as an existing customers, we are in commercial discussions on a variety of matters pertaining to its interest in Bombardier aircraft; however, these commercial discussions are confidential and we will not comment further.”

Bombardier has sold 177 of its new CSeries aircraft, and aims to have 300 orders by entry into service, tentatively slated for late 2014.

]]>http://business.financialpost.com/transportation/iraq-preparing-order-for-five-bombardier-cseries-report/wcm/83c761f3-c83f-42cb-af79-a9567ff60616/feed0cseriesScott DeveauBombardier’s CSeries first flight a success, but costs cloud jet debuthttp://business.financialpost.com/transportation/bombardier-cseries-takes-to-skies-in-maiden-flight-shares-rise/wcm/da0c2797-6780-43de-9c0c-7d003b57b354
http://business.financialpost.com/transportation/bombardier-cseries-takes-to-skies-in-maiden-flight-shares-rise/wcm/da0c2797-6780-43de-9c0c-7d003b57b354#respondMon, 16 Sep 2013 14:18:38 +0000http://business.financialpost.com/?p=365225]]>MIRABEL, Que. — Bombardier Inc.’s new CSeries aircraft took to the skies for the first time Monday morning and, save for a few minor issues, the maiden voyage of perhaps the most important jet Canadian civil aviation history was a success.

The only possible dark cloud on an otherwise sunny day northwest of Montreal was an indication from Bombardier’s management that the cost of the CSeries’ program was creeping up to $3.9-billion from the $3.4-billion figure it previously forecast.

First flight was a significant milestone for the transcontinental jet and, after successive delays, comes roughly eight and a half months behind schedule.

Still, the mood was jovial at the company’s plant in Mirabel, Que., Monday where roughly 3,000 employees, customers, suppliers and other stakeholders gathered to see the new 110-to-145-seat aircraft’s maiden flight on a brisk September day.

The skies cleared shortly before the plane took off at 9:55 a.m., and remained clear throughout the two-and-a-half hour test flight.

Chuck Ellis, the lead test pilot for the flight, said the plane performed to his expectations save for some minor issues.

“In many ways we didn’t learn anything new, although we validated a few things we already did know,” Mr. Ellis said during a press conference after the flight.

He characterized the issues the crew faced during the flight as “very minor” involving a small alert from one of the aircraft’s subsystems. But he said it wasn’t sufficient a threat to turn the plane around and cut the test flight short.

“We did accomplish all of the mission objectives,” Mr. Ellis said.

A lot is riding on the success of the CSeries — Bombardier’s largest plane to date.

“There are a lot of emotions for me and all our employees,” Pierre Beaudoin, Bombardier chief executive, said in an interview ahead of the flight. “Everyone has worked very hard to get to the point we are today, and you can see how excited everyone is.”

The aircraft fills a void in the market below the smallest planes build by Boeing and Airbus and the largest regional aircraft built by Bombardier, ATR, and Embraer.

Scott Deveau

To date, Bombardier has sold 177 of the aircraft. But management says it remains on track to sell 300 of the aircraft by the time it enters service, which is still 12 months away.

Guy Hachey, Bombardier Aerospace president, said the CSeries will be the ‘cornerstone’ of the company’s commercial aircraft segment in the years to come. Bombardier estimates it will add $5-billion to $8-billion in additional revenue to be derived from the program annually once its ramps up.

“That’s a huge upside,” Mr. Hachey said.

On Friday, the company started the high-speed taxi tests on the flight test vehicle [FTV1], one of the final tests before the flight.

He did caution that the 12-month flight test program is “aggressive,” and said management would update the market in the coming weeks about when exactly it plans to deliver the first aircraft.

While it will likely take a few weeks for Bombardier to process the data from the flights to prove the plane’s promises, one thing was clear Monday — it is a remarkably quiet aircraft for its size.

Mr. Hachey said the plane’s noise footprint is about four times quieter than existing aircraft on the market, or roughly 15 decibels quieter than a 737. That makes it roughly as loud as Bombardier’s Q400s turboprops, he said.

That was something that didn’t go unnoticed by Robert Deluce, Porter Airlines chief executive, who was in attendance for the flight Monday.

Porter is in the midst of a battle to extend the runway at its home base at Toronto’s Billy Bishop airport to accommodate the CSeries.

But the current agreement between the federal government, the City of Toronto and the Toronto Port Authority prohibits the use of jets at the Toronto Island airport.

Mr. Deluce said the CSeries’ first flight should provide evidence to those who oppose flying jets at the island that the plane is as quiet — if not more quiet — than the current Bombardier Q400s that Porter flies at the airport.

David Newman, Cormark Securities analyst, said he believed the start of the flight test program would be a catalyst for Bombardier to win new orders for the plane too once the flight data starts to prove out some of its other promises.

Bombardier has said it expects the plane to be 20% more fuel efficient and cost 15% less to operate because of its advanced technologies.

“We believe Bombardier’s focus following its successful first flight, achieved today, will be to progressively test the aircraft, pad its order book and complete certification,” Mr. Newman said.

Bombardier has said it aims to capture half of the 6,900 deliveries it expects industry-wide in the 100-to-149-seat segment over the next two decades.

But Mr. Newman said it is more likely to capture about a third — or about 2,100 to 2,300 aircraft. He said he also expected the plane to enter into service in late 2014, or even early 2015.

Perhaps the only concern that arose Monday was the suggestion that the overall cost of the program was starting to climb higher.

Scott Deveau/National Post

Mike Arcamone, Bombardier Commercial Aircraft president, said during a press conference that the cost of the program was now $3.9-billion, about $500-million more than previously forecast.

“I’m telling you right now it’s about $3.9-billion,” Mr. Arcamone said. “As we get into the program then we get more realistic numbers. But the target I’ve been trying to look at is to stay below [$3.9-billion].”

It was a surprising admission, and Mr. Arcamone quickly backtracked on his comments after a note was slipped to his public relations manager.

But Walter Spracklin, RBC Capital Markets analyst, said the $3.9-billion figure was in line with his estimates based on disclosed data and certain assumptions, including the cost of delays, issues with the fuselage provided by the CSeries’ Chinese supplier, and other factors.

He said, however, he didn’t think the cost overruns were a major concern.

“We believe this will not have a material impact to Bombardier’s liquidity position and can be easily funded through the balance sheet,” Mr. Spracklin said.

]]>http://business.financialpost.com/transportation/bombardier-cseries-takes-to-skies-in-maiden-flight-shares-rise/wcm/da0c2797-6780-43de-9c0c-7d003b57b354/feed0CSeriesScott DeveauScott DeveauRyan Remiorz/The Canadian PressScott Deveau/National PostBombardier CSeries entry into service could slip to 2015: analysthttp://business.financialpost.com/investing/trading-desk/bombardier-cseries-entry-into-service-could-slip-to-2015-analyst/wcm/9bc06c3c-a769-48ee-8782-600bf7be67a1
http://business.financialpost.com/investing/trading-desk/bombardier-cseries-entry-into-service-could-slip-to-2015-analyst/wcm/9bc06c3c-a769-48ee-8782-600bf7be67a1#respondMon, 19 Aug 2013 15:14:55 +0000http://business.financialpost.com/?p=356431]]>While the first flight of Bombardier Inc.’s new CSeries aircraft appears to be nearing, one analyst says he believes the aircraft’s first delivery won’t occur until early 2015.

The Montreal-based manufacturer posted a YouTube video on Friday showing the new aircraft performing its low-speed taxiing test – one of the last ground tests before first flight.

It also said it needed to paint the plane before it takes to the sky for its maiden flight.

Cameron Doerksen, National Bank Financial analyst, said this means that first flight could potentially occur before the end of August, or about eight months behind schedule.

Bombardier has scheduled the CSeries flight test program to last one year after first flight, implying an entry into service date of roughly September 2014.

Management said at the end of July they expected the first flight to occur ‘in the coming weeks,’ but has offered no guidance since. The company said it would update the entry into service date once the flight test program is underway.

Mr. Doerksen said he believed the delays to first flight would likely mean the entry into service for the plane would not occur until early 2015.

“Given Bombardier’s inability to correctly predict the timing of first flight, we think it is inevitable that the already aggressive flight test program will take more than a year and that [entry into service] will be pushed to the right,” he said in a note to clients.

But Mr. Doerksen said a delay of that sort would not likely be overly material to the program from a financial perspective, given that on the current schedule he was only forecasting six CSeries deliveries in 2014.

This will, however, largely leave the stock range-bound in the near-term, he said.

At the same time with just 177 firm orders on the books for the plane, he said he believed Bombardier would have to win at least one or more large-scale orders from well known airlines to alleviate investor concerns about the long-term viability of the program.

“While the first flight of the CSeries should be viewed positively by the market and the stock may get a small lift, we see Bombardier’s shares as being range-bound in the short term. Investors are likely to shift their focus to the risks associated with the flight test program itself and potential delays to [entry into service], as well as the lack of recent orders for the CSeries,” Mr. Doerksen said.

Mr. Doerksen has a $5.50 price target on Bombardier, and an outperform rating on the stock.

]]>http://business.financialpost.com/investing/trading-desk/bombardier-cseries-entry-into-service-could-slip-to-2015-analyst/wcm/9bc06c3c-a769-48ee-8782-600bf7be67a1/feed0bombardier-cseriesScott DeveauBombardier poised to win Britain’s Crossrail contract after Siemens pulls outhttp://business.financialpost.com/transportation/bombardier-poised-to-win-britains-crossrail-contract-after-siemens-pulls-out/wcm/d73e0a0f-b8c8-49f4-84f6-01528a5fce43
http://business.financialpost.com/transportation/bombardier-poised-to-win-britains-crossrail-contract-after-siemens-pulls-out/wcm/d73e0a0f-b8c8-49f4-84f6-01528a5fce43#respondFri, 05 Jul 2013 14:34:15 +0000http://business.financialpost.com/?p=342409]]>LONDON — German industrial conglomerate Siemens on Friday said it had pulled out of the bidding for Britain’s multi-billion pound Crossrail project, opening the door for Bombardier to win the contract.

Siemens said it no longer had the capacity to deliver 600 carriages for the new line to connect east and west London.

“Crossrail is a very large project and, since first undertaking our initial assessment of capacity and deliverability, Siemens has won multiple additional orders,” the company said in a statement.

“To pursue another project of this scale could impact our ability to deliver our current customer commitments – something we believe would not be a responsible course of action.”

Siemens recently beat Bombardier to the $2.4 billion contract to build 1,140 new carriages for use on the Thameslink rail line that runs through London and connects Bedford with Brighton on the south coast of England.

]]>http://business.financialpost.com/transportation/bombardier-poised-to-win-britains-crossrail-contract-after-siemens-pulls-out/wcm/d73e0a0f-b8c8-49f4-84f6-01528a5fce43/feed0crossrailReutersBombardier getting its planes to Paris Air Show on timehttp://business.financialpost.com/transportation/paris-air-show-getting-the-planes-there-on-time/wcm/d3c8934e-ceae-4db7-9f2f-9e0f9913e6d5
http://business.financialpost.com/transportation/paris-air-show-getting-the-planes-there-on-time/wcm/d3c8934e-ceae-4db7-9f2f-9e0f9913e6d5#respondMon, 17 Jun 2013 06:44:38 +0000http://business.financialpost.com/?p=335099]]>Capt. Brian Price has one of the more interesting jobs you can have as a pilot.

Among his duties as chief pilot for Bombardier’s Q400, Capt. Price is tasked with ferrying the popular turboprop around the world to show off the plane to would-be customers and for other industry events, like this week’s Paris Air Show.

His job has taken him around the world many times over, all across North America, Russia, China, Japan, and as far as Myanmar, Australia and India, as he shuffled Q400s in four-hour stints around the globe.

These extended journeys often last days and are throwback to a time before the late 50s when transatlantic trips became a non-stop affair.

But Capt. Price says he still prefers to fly by turboprop rather than sit in the back of the plane on a commercial flight.

“It’s a bit of an adventure,” he said in an interview from the cockpit of a Q400 fresh off the assembly line somewhere above Kingston, Ont., Saturday afternoon.

Those adventures have taken him to all kinds of crazy places, and, as a result, Capt. Price can tell you the best place to get a pizza in Nome, Alaska, or a place where you can grill your own steaks in Goose Bay, Labrador.

He can also warn you to avoid the horse-meat fajitas at place called Chicago’s in Yakutsk, Russia, and to avoid overnights in Petropavlovsk because, as his First Officer Glen Arthur says, the “hotels are like prisons.”

Unlike its larger rivals, Boeing and Airbus, Bombardier is faced with an interesting challenge getting its Q400 and CRJ1000 to Le Bourget airport for this week’s show.

Both aircraft lack the range to fly directly to Paris, and so Bombardier is forced to hop them across landmasses in the North Atlantic to get them to the air show.

By next year, Bombardier should be able to fly its new CSeries directly to the air show, which alternates to Farnborough, England, every other year.

But both the Q400 and CRJ will still have to make the extended milk run from Mirabel and Downsview.

The Financial Post decided to tag along for a ride on one of Bombardier’s new Q400s destined for Paris this weekend, which was freshly painted with an Air Baltic livery.

Another CRJ1000, just off the assembly line as well and painted with Indonesia’s Garuda livery, left Friday from Mirabel destined for the show.

In all, our Q400 trip took the better part of 24 hours, with an overnight in Happy Valley-Goose Bay and fuel stop in Keflavik, Iceland, before landing in Paris.

From the start, it was clear that this was going to be nothing like a commercial flight, in part, because the plane had only logged six hours in the air for its flight tests before departing for Paris Saturday afternoon.

It only got its airworthiness certificate on Friday.

The certification process, which typically takes five days or more to complete, was expedited in four in order to get the plane to Paris on time for the show. And even then, we made it there with little time to spare.

The original trip was meant to occur on Thursday morning, before it was bumped to Friday morning. Then it was bumped to Friday night, and then to Saturday morning.

Some issues with the tail section and some last-minute touch ups on the paint job pushed out our departure until shortly after 2 p.m. Saturday afternoon, and our arrival in Paris at about 8 p.m. local time Sunday evening.

Scott Deveau/National Post

Capt. Price decided Saturday afternoon that we’d overnight in Goose Bay rather than push all the way through to Paris on Saturday because his duty hours limit how many hours he can fly a day, and require that he has at least eight hours of uninterrupted sleep in between shifts.

Knowing that we couldn’t make it to Paris in time, he crunched the numbers and decided it would be quicker to overnight in Goose Bay than in Keflavik.

Goose Bay has earned its place in Canadian aviation history, built by the U.S. Air Force in the Second World War, it was an important staging ground.

But it is not Paris. The local art scene is more about taking in static displays of the Avro Vulcan and inukshuks than the sculptures of Rodin. And the local cuisine draws on delicacies like deep-fried cod tongues rather than escargot and exotic cheeses.

Still, it isn’t a bad place to spend a night swapping war stories over a couple beers, so long as you can forgo luxuries like cell reception and working WiFi for a night.

First Officer Arthur said you need to be flexible with your schedule on these ferry flights, which tend to have a more ‘fluid’ schedule than commercial airlines.

Capt. Price said he has been on 40 or 50 of these journeys, and there are numerous issues you can encounter, especially in places like Russia and China, which often require detours hundreds of miles off course due to rigid no-fly zones and other restrictions across those countries.

Jan Neidzinski, a Bombardier technician who flies on these ferry flights, said it can also be a bit “sketchy” at times in places like Russia, where you do your inspection of the aircraft basically at gun point and the truck drivers smoke while the aircraft refuels.

Capt. Price said he once had a plane impounded in Russia for three days while he struggled through diplomatic channels to get the necessary paperwork to get home.

There is, however, a window in which you work, and we certainly were pushing up against the tail end of ours to arrive at the air show Sunday evening.

Adding to the adventure, Capt. Price says many of the issues that arise in an aircraft typically occur within the first 100 hours of flying – something he calls the “infant mortality rate” of the components – or not until much later in its life.

Scott Deveau/National Post

The issues that arise are typically with the electrical system. But he said the Q400 actually has a reliability rate in excess of 99.4%. The biggest scare he said he has ever experienced was a pressurization issue that occurred mid-flight.

But he said the bulk of the challenge is simply fuel management and making sure you can make it to your next destination.

The Q400 has a range of just over 2,500 kilometres with a maximum load of 78 passengers. That’s a startling figure given Keflavik is about nearly 2,500 kilometres from Goose Bay, the way the crow flies.

The Q400 is ideally suited for missions 2 hours or less. Each leg of our journey to Paris lasted nearly four hours.

Of course, the range of the plane can be extended up to about 3,300 kilometres with an empty load, Capt. Price said. Our flight had just six people aboard.

Jerome Cheung, director of market development for Bombardier Commercial Aircraft, said the company tends to ferry aircraft fresh off the assembly line because they want to show the ‘latest and greatest’ features and interior designs. The Air Baltic Q400 was carrying some new slim-line seats Bombardier is hoping to sell.

At the same time, Mr. Cheung said once an aircraft enters service, its difficult to take it out again simply to sit on the runway at Le Bourget for a week, and it’s uneconomical to keep a plane in inventory just for demonstration purposes.

“It has a lot to do with availability,” he said. “Aircraft are meant to be up in the air generating revenue for airlines.”

Plus, he said, customers love that “new plane smell.”

Showing off the Q400 and CRJ, alongside Bombardier’s business jets, is a must at Paris. While much of the attention will likely be focused on the first flight of its new CSeries aircraft, which is slated for next week, the regional jet and turboprop market is an important and highly competitive segment for Bombardier and its rivals.

Bombardier negotiated with Air Baltic to use its Q400 for display in Paris, and will take it back to Canada on Thursday before it’s ferried back to Europe at a later date.

Scott Deveau/National Post

In all, Bombardier forecasts 12,800 aircraft will be delivered over the next two decades in the 20-to-149 seat category it competes in, for a combined value of roughly US$646-billion.

As fuel prices continue the rise, the economics of turboprops will also have a major impact on fleet choices, and will likely account for about 48% of deliveries over that period, according to Bombardier’s latest market forecast.

In addition to its CRJ and Q400s, Bombardier is hoping that it can capture roughly half of the orders expected over that period in 100-to-149-seat segment with its new CSeries aircraft, which is still expected to have its first flight next week, just a little late for the industry’s marquee event in Paris this week.

The company will, however, likely face stiff competition in the segment as Airbus and Boeing try to move airlines into their larger offerings, the A320neo and 737MAX respectively.

Embraer is also expected to formally launch its so-called G2 in Paris this week.

The G2 is a derivative of its popular E-Jet with different wings, fly-by-wire controls, and a new Pratt & Whitney engine among its various improvements.

Scott Hamilton, managing director of Leeham Company LLC, an aviation consultancy firm, told an investors conference in Montreal last week he expects Embraer could also announce up to 400 orders and other commitments for the plane at the show.
The G2 will also be larger than the existing E-Jets, which can reach 122 seats in a single-class configuration, meaning it will compete head-to-head with the CSeries.

Bombardier does, however, have an edge with the first delivery of the CSeries expected next year. That is well ahead of the 2018 entry into service expected for the G2; 2016 for the A320neo; and 2017 for the 737MAX.

The CSeries also has a longer range than the G2 is expected to have.

Mr. Cheung said Bombardier welcomes the competition.

“With Bombardier, I think we have the best product offering,” he said. “We have the Q400 high-speed turboprop that can cover all the short-to-medium haul market. Then we have the very-well proven CRJ for the medium-to-long range markets.

He said the CSeries will only bolster that portfolio when it enters into service.

]]>http://business.financialpost.com/transportation/paris-air-show-getting-the-planes-there-on-time/wcm/d3c8934e-ceae-4db7-9f2f-9e0f9913e6d5/feed0downsview1Scott DeveauNTNP_20130617_National_FP3_108028_I002Scott Deveau/National PostScott Deveau/National PostScott Deveau/National PostDaniel Desjardins to receive Lifetime Achievement honor at 2013 CGCAshttp://business.financialpost.com/legal-post/daniel-desjardins-to-receive-lifetime-achievement-honor-at-2013-cgcas/wcm/53b1b713-85a2-4eae-8278-03359049aa77
http://business.financialpost.com/legal-post/daniel-desjardins-to-receive-lifetime-achievement-honor-at-2013-cgcas/wcm/53b1b713-85a2-4eae-8278-03359049aa77#respondWed, 15 May 2013 09:08:43 +0000http://business.financialpost.com/?p=321264]]>Daniel Desjardins, senior vice president and general counsel of Bombardier Inc., will receive the Lifetime Achievement honor at the 2013 Canadian General Counsel Awards in June.
The CGCAs, which salute Canada’s best in-house lawyers, were founded by the National Post and ZSA Legal Recruitment nine years ago. This year’s awards will be presented at a gala on Monday, June 17 at the Fairmont Royal York in Toronto.
There are eight awards this year. Canadian General Counsel of the Year will be announced at the gala, while finalists for five categories have been announced (see below). But two award recipients were made public this week: Mr. Desjardins gets the nod for Lifetime Achievement, while the legal team at BMO Financial Group will be recognized with this year’s Social Responsibility award.
“I feel very honored,” said Mr. Desjardins in a brief interview on Tuesday. “My first reaction was to thank my team. As we all know, we are only as good as the team that we have. I’m very proud of the team and the legal service that we have at Bombardier.”
Mr. Desjardins was called to the bar in 1978. After a decade in private practice, he joined Bombardier, the Montreal-based plane and train manufacturer. He now leads a team of more than 175 lawyers in 17 jurisdictions around the world.
Those who’ve worked with Mr. Desjardins describe him as a disciplined, highly-skilled lawyer and a “true leader.” He is responsible for several files within the company, among them environmental matters, health and safety, and insurance.
On the financial front, he has played an active role in several of Bombardier’s mega deals over the past decade or so. He was involved in the company’s $1.1-billion acquisition of DaimlerChrysler Rail Systems – more commonly known as Adtranz. He had a hand in the negotiations that led to a $7.9-billion contract for the renewal of London, England’s subway system. And he was involved in a major recapitalization program that included a $1.2-billion equity offering, the sale of the company’s recreational products division, and the sale of Bombardier Capital’s inventory financing division.
He says he is very proud of his role in advancing Bombardier’s corporate social responsibility policies. He is chair of the company’s CSR committee, and as such as led Bombardier to qualify for inclusion in a number of important indices and rankings, such as the Dow Jones World Sustainability Index and the Jantzi Social Index.
Mr. Desjardins has received peer recognition before. He was named ILO/ACC General Counsel of the Year in 2007 and received the Robert V.A. Jones Award in 2010 from the Canadian Corporate Counsel Association.
The more than 730 lawyers and legal professionals working in-house BMO, a team led by much respected general counsel Simon Fish, will be recognized with this year’s Social Responsibility Award.
BMO earned the honor through a range of detailed initiatives that commit the bank to hitting specific targets and goals. For example, BMO has a stated policy to have women make up at least one third of the bank’s board. And by 2013, the bank aims for 40% of all executive positions to be held by women.
“To deliver on our strategic priorities we must attract and retain a talented, diverse workforce,” Mr. Fish says in a report. “We must support and invest in the communities where we live and operate; and we must pay attention to societal issues and global risks that may have an impact on the way we do business.”
Some tables are still available for this year’s gala. Visit the award website, cgca.ca, for more information.

]]>http://business.financialpost.com/legal-post/daniel-desjardins-to-receive-lifetime-achievement-honor-at-2013-cgcas/wcm/53b1b713-85a2-4eae-8278-03359049aa77/feed0Daniel DesjardinsvonhasselbachBombardier gets German $226-million order for 35 trainshttp://business.financialpost.com/transportation/bombardier-gets-german-226-million-order-for-35-trains/wcm/4b72ad51-b330-438f-ac1e-5fc183fd2da2
http://business.financialpost.com/transportation/bombardier-gets-german-226-million-order-for-35-trains/wcm/4b72ad51-b330-438f-ac1e-5fc183fd2da2#respondMon, 31 Dec 2012 14:05:07 +0000http://business.financialpost.com/?p=272962]]>BERLIN — Montreal based Bombardier says it has an order to supply Germany’s Abellio Rail with 35 of its Talent 2 trains in a deal valued at US$226 million.

Bombardier announced in a release Monday morning that it will supply 20 three-car and 15 five-car trains, with the vehicles due to enter service in December 2015.

The company develops and manufactures the Talent 2 trains at its site in Hennigsdorf, Germany.

Bombardier says the units will be equipped with its MITRAC 1000 propulsion and control system.

It says one of the advantages of this system is that it allows the train to accelerate quickly to a constant speed.

]]>http://business.financialpost.com/transportation/bombardier-gets-german-226-million-order-for-35-trains/wcm/4b72ad51-b330-438f-ac1e-5fc183fd2da2/feed0bombardiertrain_hocanadianpressnpBombardier starts assembly of first CSeries flight test vehiclehttp://business.financialpost.com/transportation/bombardier-starts-assembly-of-first-cseries-flight-test-vehicle/wcm/e80406cf-15fc-4929-89ec-6540a476d251
http://business.financialpost.com/transportation/bombardier-starts-assembly-of-first-cseries-flight-test-vehicle/wcm/e80406cf-15fc-4929-89ec-6540a476d251#respondTue, 16 Oct 2012 13:10:10 +0000http://business.financialpost.com/?p=250637]]>Bombardier Inc. said Monday it had started the assembly of its first CSeries flight test vehicle, known as FTV1, after receiving the cockpit and various sections of the plane’s fuselage, including those built in China.

The Montreal manufacturer said it remains on track for first CSeries flight by the end of the year.

[np-related]

While the integrated testing of the aircraft’s various systems continues, Bombardier said it had also received the first composite wings for the its static test airframe from Belfast.

Strength and fatigue testing is expected to begin on the test airframe this fall, the company has said.

“To date, tests have shown no unexpected results and all is going as planned,” said Rob Dewar, general manager of the CSeries program, in a statement.

]]>http://business.financialpost.com/transportation/bombardier-starts-assembly-of-first-cseries-flight-test-vehicle/wcm/e80406cf-15fc-4929-89ec-6540a476d251/feed0Scott DeveauBombardier’s Chinese CSeries supplier on track?http://business.financialpost.com/investing/trading-desk/bombardiers-chinese-cseries-supplier-on-track/wcm/63cec31f-0919-4611-beed-34ce53cff5c4
Tue, 16 Oct 2012 12:59:16 +0000http://business.financialpost.com/?p=250619]]>A tour of Bombardier Inc.’s Chinese supplier, SAC Commercial Aircraft Co. Ltd., has left analysts with both a sense of comfort and concern about its role in the CSeries program.

SACC has been the focal point for many in the CSeries’ supply chain because it is responsible for the development and production of the rear fuselage barrel, mid-fuselage and other components.

While the company, located in Shenyang, China, has been a long-time supplier of fuselage components for Bombardier’s Q400 turboprops, it is unproven in the type of composite parts the CSeries will use.

[np-related]

Bombardier has already repatriated the mid-fuselage work for the CSeries from SACC to its plant in Belfast, a move it said was necessary to meet the demands of its program. But the Montreal manufacturer has repeatedly said the CSeries remains on track for first flight at the end of 2012 and for entry into service by the end of 2013.

In order to alleviate concerns about the Chinese supplier, Bombardier took a group of analysts on a tour of SACC this week and reaction was mixed.

“As we understand it, the issue was that SACC took on more work than it could handle and due to the slow development progress Bombardier felt it prudent to bring work back in house to maintain its development schedule,” Cameron Doerksen, National Bank Financial analyst, said in a note to clients.

Bombardier has the ability to keep the production in-house, he said, but wants to shift it back to SACC because of its lower costs.

Mr. Doerksen also said he saw the rear fuselages for all the CSeries test flight vehicles in various stages of production, giving him confidence it will meet the flight test schedule.

Although Mr. Doerksen said there is a “high degree of skepticism” at this point that the CSeries will be in the air by the end of the year, he wouldn’t consider a short delay a major issue.

“If Bombardier can hit its target or close to it, we believe first flight will be a key catalyst for the stock and for new orders,” he said, maintaining his outperform rating and $4.50 price target. Bombardier closed Tuesday up 4¢ at $3.73.

Bombardier said this week that assembly of the first test flight vehicle has already begun at its facility in Mirabel, Que.

Walter Spracklin, an analyst at RBC Capital Markets, agreed SACC appeared to be on track to meet Bombardier’s entry into service target. But he said it was not made clear why SACC struggled with the mid-fuselage work in the first place and what that will mean for the CSeries’ future production targets.

“Given that we do not believe SACC poses a significant risk to [entry into service], this will likely be positive from a near-term sentiment standpoint,” he said in a note to clients, keeping his outperform rating and $5 price target.

“If however [entry into service] occurs on time (or relatively close), the risk will shift to production rate requirements of SACC, and its ability to meet those requirements remains a (longer-term) concern for us.”

“No surprise – the picture ain’t pretty,” he said in a note to clients.

[np-related]

Bombardier has said its new CSeries will be in the air by the end of 2012 ahead of its first delivery in late 2013. But there is substantial risk until that point, Mr. Astle said.

Boeing, for example, underperformed the Dow Jones Industrial average by about 20% between 2007 and 2008 during the launch process of the 787, he said.

EADS, the parent company of Airbus, on the other hand, actually performed quite well until its A380 hit production and delivery delays. The stock then tumbled by about 50%.

Embraer was also weaker between 2002 and 2004 when it was launching its new regional jets, the E170 and E190, also falling 25% relative to the Dow, before building steam again as it delivered and built its book of business.

Mr. Astle’s conclusion: owning aerospace stocks during a major aircraft launch poses significant risk, and owning them after the plane is well into service is a better strategy.

“We admit, that the A380 and 787 were two of the most problematic launches in recent aerospace history, and these big birds may have higher complexity [than] the smaller CSeries; however, keep in mind that the CSeries represents the launch of both a new all-composite airframe AND a new engine technology,” he said.

He acknowledged Bombardier also has its rail division to bolster its shares. But he said that’s where he sees most of the value at this point.

“This review re-enforces our view that Bombardier’s commercial aircraft business currently contributes little to a sum-of- the-parts valuation and its headline risk for the stock remains high for the next 18 months or so,” he said.

]]>http://business.financialpost.com/investing/trading-desk/boeing-airbus-embraer-review-doesnt-bode-well-for-bombardier/wcm/8b5871a1-c397-4324-a107-698ca1f3f675/feed0Bombardier CSeriesScott DeveauMarket has it wrong on Bombardier – analysthttp://business.financialpost.com/investing/trading-desk/market-has-it-wrong-on-bombardier-analyst/wcm/fe04d349-c300-42c2-80c9-b41a8c879ce2
http://business.financialpost.com/investing/trading-desk/market-has-it-wrong-on-bombardier-analyst/wcm/fe04d349-c300-42c2-80c9-b41a8c879ce2#respondWed, 08 Aug 2012 18:24:53 +0000http://business.financialpost.com/?p=209698]]>Bombardier Inc. is trading at a valuation rarely seen over the past decade, which one analyst says demonstrates that Mr. Market often gets it wrong.

While admitting that the leading aircraft and rail equipment provider faces several risks going forward, Raymond James analyst Steve Hansen believes these are more than priced into Bombardier shares.

These threats include global macro economic uncertainty, potential CSeries delays and cost overruns, low regional aircraft order backlogs, and the possibility of a slower-then-forecast recovery in the business jet market.

Bombardier is currently trading at roughly 8x forward earnings, while historical data shows that the stock has only been below 8.5x during three brief periods.

“The most recent instance, not surprisingly, was during the recent 2008/2009 global economic recession, a period wherein business jet demand capitulated, net orders plummeted as cancellations ballooned, and BBD’s associated backlog came under significant pressure,” Mr. Hansen said. “Today’s environment is far more constructive than those dark days, in our view, a point we feel is lost in the current share price and deeply discounted valuation.”

The analyst highlighted Bombardier’s strong level of recent orders, potential catalysts on the horizon, as well as long-term growth and margin expansion opportunities.

Bombardier is set to report second quarter results before markets open on Thursday.

Mr. Hansen forecasts earnings per share of 10¢, which is in line with consensus. He has a $5 price target on the stock, representing upside of more than 30%.

“Continued progress towards meeting management’s 2012 and 2013
margin and delivery guidance at both Bombardier Aerospace and Bombardier Transportation should, in our view, help serve as a catalyst for the stock,” the analyst said.

The Halifax-based company, which will operate the planes under its Jazz Aviation LP subsidiary, said the six aircraft are conversions of some of the 15 options it currently has on Q400s stemming from its order in 2010 for 15 of the aircraft. The deal is valued at $189-million, based on list price.

“We just took delivery of our 15th Q400 aircraft and we are very pleased to set in motion the acquisition of the next batch of aircraft to continue the modernization of the Jazz Aviation fleet,” said Joseph Randell, Chorus chief executive. “The Q400 NextGen airliner is a perfect complement to our fleet of Bombardier turboprops and regional jets and has served us extremely well.”

The Q400s are part of Chorus’ fleet renewal program aimed at making it more competitive on short-haul routes.

In May, Air Canada’s main domestic competitor, WestJet Airlines Ltd., replaced a firm order for 20 Q400s, and put another 25 on option, for its new regional carrier, which it intends to launch next year.

Air Canada’s smaller rival Porter Airlines Inc. also operates a fleet of Q400s from its base on Toronto Island.

]]>http://business.financialpost.com/transportation/chorus-aviation-to-buy-6-bombardier-q400-planes/wcm/5b29c3cb-a086-4a70-9e79-31c057d6296b/feed0jazz_retScott DeveauAssembly of Bombardier’s first-ever CSeries underwayhttp://business.financialpost.com/news/assembly-of-bombardiers-first-ever-cseries-underway/wcm/ed649cb3-6518-41ed-b5dc-1b2e7234faac
http://business.financialpost.com/news/assembly-of-bombardiers-first-ever-cseries-underway/wcm/ed649cb3-6518-41ed-b5dc-1b2e7234faac#respondWed, 20 Jun 2012 20:40:57 +0000http://business.financialpost.com/?p=187245]]>The assembly of the first CSeries aircraft is well underway at Bombardier Inc.’s facility in Mirabel, Que. The new aircraft’s state-of-the-art design is on full display, demonstrating the aerodynamics of the plane from nose to tail, including the shape of its composite fuselage. Even its landing gear is there dangling from the plane.

But the most remarkable part of the new transcontinental aircraft is that it has been built entirely of plywood and pine.

Bombardier has been harnessing some of the most advanced simulation technologies available to help develop the CSeries, including the layout of its assembly plants.

[np-related]

But the wooden aircraft perhaps best demonstrates the lengths the Montreal manufacturer is willing to go to ensure the new plane is delivered on time and on budget.

Simulations have done wonders in the CSeries’ design, and will play a major role in its certification process. For example, the company’s much-touted complete integrated aircraft systems test area [CIASTA] will allow the company to do a substantial portion of the aircraft’s flight testing virtually before the plane even takes to the sky.

Yet there are some things that simulations just can’t tell you, like whether a maintenance worker can easily fit the wrench he needs to use to adjust a bolt into a gearbox.

So Bombardier decided to build the wooden mockup in the same hanger it will assemble the first test aircraft.

And the company tasked 45 of its top engineers to find 1,000 design improvements on the aircraft before it goes into production. To date, they have identified a little over 600, the company says.

“At the end of the day, these minute details will make all the difference,” said François Minville, vice-president of operations for the CSeries program.

His comments were made Tuesday during the first – and only – tour of Bombardier’s new CSeries test facility and future production plant before the plane’s maiden flight.

‘The skepticism comes from people in the industry saying that [new] planes don’t get launched on time’

With the world’s largest air show, in Farnborough, England, less than a month away, through the tour of the plant the company’s management team appears to have provided a glimmer of hope of what many thought impossible: The CSeries may actually be a commercial aircraft that is on time and (almost) on budget.

Delays and cost overruns at rivals Boeing Co. and Airbus SAS in recent years destroyed the credibility off all major aircraft manufacturers, including Bombardier. But Mike Arcamone, Bombardier’s recently appointed president of commercial aircraft, said the company is trying to make the CSeries program the benchmark for new aircraft programs industry-wide.

If Mr. Arcamone has any doubts that the plane will have its first flight by the end of the year, and be delivered to its first customer by late 2013, it didn’t show during an interview on the sidelines of the tour. Asked straight out if the plane would be in the sky by the end of the year, he said: “Absolutely.”

“The skepticism comes from people in the industry saying that [new] planes don’t get launched on time,” he said.

Moreover, he said the $3.5 billion aircraft program is also on budget [although notably edging higher than the $3.2 billion price tag originally ascribed to the program, and above the most recent public figure of $3.4-billion].

Walter Spracklin, RBC Capital Markets analyst, who attended the event this week, credited management with alleviating many fears of a potential delay.

He said the tour was an opportunity to temper expectations if there was any risk of delay. But from his perspective, there was little doubt conveyed by the company’s management that the plane would be delivered on time. He acknowledged, however, more evidence would likely be needed before investors and potential customers buy in.

“First flight will be the big one,” Mr. Spracklin said in an interview.

He said he was on the phone with investors all morning Wednesday and heard little pushback from the clients he spoke to. “Whereas a year ago, I would have been called an idiot for thinking that this is going to be on time,” he said.

Part of that new sense of optimism stems from several milestones laid out by management, including having the final test rigs delivered by the end of month before the integrated testing of its various systems, including its fly-by wire, avionics, and hydraulics, begins July 10.

The remaining structural components are expected to be delivered by the end of August, and the first static structure is on track to be built for testing by the end of September.

The major assembly of the first flight test vehicles are expected by the end of October, with final assembly to be completed by the end of December, ahead of first flight.

Robert Dewar, CSeries program manager, said Bombardier remains on track to reach each of those goals, and that he has been working seven days a week with the company’s global suppliers to ensure the plane meets its deadlines.

“We don’t squeeze suppliers, we hug them,” he joked.

It is because of the confidence Bombardier has in the timeline of its program it is unwilling to give a so-called “Boeing discount” on the planes, in other words deep discounts for initial customers under the belief that the planes won’t arrive on time, Mr. Arcamone said.

He said he was comfortable with the 138 CSeries orders on the books right now with delivery slots sold out until 2016.

“We’re actually choosing customers. We don’t want one or two big customers. We want diversity across the globe. We’re moving in that direction,” he said.

He said he is confident new orders will follow once additional milestones are hit.

Bombardier still aims to build 100 CSeries a year in the programs initial phase, before expanding production rates as more orders arrive.

Cameron Doerksen, National Bank Financial analyst, said his impression is that Bombardier is progressing with the CSeries development better than what most investors give it credit for.

“Bombardier executives admit that the timetable is tight, but our sense right now is that if the CSeries experiences a delay, it will be in the order of months, not the years experienced by other [aircraft manufacturers] on their new aircraft programs,” he said.

He said he doesn’t expect many blockbuster orders for the plane imminently. But he said more orders will likely follow soon, including potentially at Farnborough.

]]>http://business.financialpost.com/news/assembly-of-bombardiers-first-ever-cseries-underway/wcm/ed649cb3-6518-41ed-b5dc-1b2e7234faac/feed0Bombardier-CS-SeriesScott DeveauBombardier wins firm $595M order for 12 CRJ1000shttp://business.financialpost.com/news/bombardier-wins-firm-595m-order-for-12-crj1000s/wcm/55531d32-042b-41ee-9e0c-7dc27826de38
http://business.financialpost.com/news/bombardier-wins-firm-595m-order-for-12-crj1000s/wcm/55531d32-042b-41ee-9e0c-7dc27826de38#respondWed, 20 Jun 2012 20:15:36 +0000http://business.financialpost.com/?p=187229]]>MONTREAL — Bombardier Aerospace has won a US$595 million order to deliver new aircraft to a subsidiary of Danish leasing company Nordic Aviation Capital that will lease the aircraft to Garuda Indonesia airlines.

The firm order for 12 CRJ1000 is valued at US$595 million at list prices.

Garuda is the first customer in the Asia-Pacific region for Bombardier’s latest 100-seat regional jet. It directly ordered six aircraft in February and has options for 18 more planes after considering competitor Embraer’s E-190.

Nordic Aviation Capital is one of the world’s largest lessors of regional aircraft with more than 160 turboprop and jet aircraft serving more than 30 customers in 20 countries.

[np-related]

The order and another leasing company transaction on behalf of Air Norstrum in Spain “illustrate that these aircraft present attractive financing and leasing opportunities for airlines and investors,” stated Bombardier commercial aircraft president Mike Arcamone.

Bombardier has received 1,729 firm orders for its CRJ series aircraft, with 1,665 delivered as of March 31 to more than 60 airlines around the world. More than 30 customers also operate corporate variants.

Bombardier said on average a CRJ aircraft takes off every 10 seconds somewhere in the world.

Analysts expect a lull in regional aircraft orders won by Bombardier may be nearing an end after a slew of recent orders.

The Montreal-based manufacturer last year received orders for only four regional jets and seven Q400 turboprops.